Post navigation

Trading Week 29/04/13

EURX: it seems now that it might only be a matter of time before this punches up through the 108.5 S/R level:

USDX: the top of any Cloud is know to be a form of S/R and the USDX has found this too much resistance just now. price is back to falling within the Cloud.

These choppy Cloud divergent markets might offer up good 30 min chart trades again during the US session. We shall see!

Oil:

S&P500:

Friday 3rd (3.50 pm) Possible SPY trade yields max 52%

Not too much happening. Both indices seem to be hanging near the safety of their monthly pivots in the lead up to NFP:

Friday 3rd (10.30 am) Possible SPY trade yields max 52%

A/U: this seems to be bouncing off the major support zone:

E/U: I find this quite interesting. Look at the ADX! There seems to be absolutely no wider interest, for now at least, in going SHORT just here:

NFP tonight might give some more clues to broader market direction.

It is a magnificent day here today..warm…sunny…blues skies. I’m out for lunch and, later, out for dinner.

Friday 3rd (6.40 am) Possible SPY trade yields max 52%

Both indices are back to being stuck in their daily Cloud. Positive US data and the ECB rate cut sent the Euro down and the USD up:

The stock markets welcomed the news and, yet again, another great SPY trade presented itself during the US session on the 30 min charts. The signal came through when the S&P500 was at $1,582. Thus, I would look to buy the May $159 Call Option:

The May $159 Call Option opened at $1.30, increased by 0.68 cents and closed at $1.98 during the US trading session. That is an increase of 52%

ROIC= ($0.68/$1.30) x 100 = 52%. If only I didn’t need any sleep!

The E/U didn’t like this rate cut BUT I don’t have a signal to SHORT:

Most of the E/U action came after the rate cut:

A/U: it doesn’t know whether to join the E/U or stocks!

Thursday 2nd (10.30 pm) Possible SPY Put trade yields over 60% ROIC

I waited to see if there would be a clear new trend after the US data and ECB news. Not so clear though. Euro popped up but now falling back. Yen pairs off and racing though. The positive US data might be re-kindling thoughts of reduced easing and, thus, boosting the USD.

E/U: I have just noted that this pair is trading above its own 4hr Cloud and trying to break up and out from its daily Cloud. This would be quite bullish if it could breakout! The ECB news out later might impact this trend though!

A/U: this is looking rather bearish as it approached major support in the form of a monthly trend line and the horizontal $1.02 level. It will be interesting to see if this holds. Any pull back with stocks and the S&P500 would spell bad news for this pair!

G/U: this pair is waiting on some data due out soon:

Thursday 2nd (4.15 pm) Possible SPY Put trade yields over 60% ROIC

EURX: this is still wedged between the 108.5 S/R level and the daily Cloud. Don’t expect much movement anywhere whilst this remains the case!

USDX: this remains embedded in the daily Cloud. Don’t expect much movement anywhere whilst this remains the case!

E/U: this signal has now closed off:

There is ECB news out later which the markets seem to be waiting for. Any interest rate cuts might see the Euro fall and, thus, so too the EURX.

Thursday 2nd (12.04 pm) Possible SPY Put trade yields over 60% ROIC

USDX: price has broken down through the previous S/R level of 81.7. price is re-testing this level as I type. The significance of this level can be seen from the weekly chart:

USDX weekly

USDX daily: I do note the reversal style pin bar here though:

USDX 4 hr

Thursday 2nd (11.50 am) Possible SPY Put trade yields over 60% ROIC

A/U: there was a signal to short after my 7am candle:

There is ECB news out during the European session that might have a bit of impact today.

Thursday 2nd (6.30 am) Possible SPY Put trade yields over 60% ROIC

Some weak US data moderated risk appetite during the US session. The USD still had a down day but the rise of the EURX was slowed somewhat:

These choppy and divergent markets continue to give better trading opportunities off the 30 min charts during the US session. Last night was no different. There were great trades possible on the typical ‘risk sensitive’ instrument: S&P500, A/U and Kiwi:

S&P500: Stocks didn’t like the US data:

Oil slid on ‘supply’ data too:

FTSE: was up and down:

A/U: long signal now closed off. An easy 30 min short trade though:

Kiwi: ditto:

SPY trade: There was another great SPY trade opportunity off the S&P500 30 min charts during the US session. My TS signal came through when the index was at $1,588:

I would then look to buy the May $158 Put Option. This opened the session at $1.01 and finished at $1.64. That is an increase of $0.63 cents.

NB: I would not have got in at such a good price but this is the only data I can work from:

ROIC= ($0.63/$1.01) x 100 = 62% !

So, the markets continue to chop around during these divergent conditions. Nothing new!

PS: My daily Cloud chart just closed but is still showing bullish tendencies on the S&P500!

S&P500: Over recent weeks I have been hearing and reading reports suggesting about a significnat market correction/reversal. I had stated that I had not being seeing any signs of this. That was until last week. The one bearish signal that had appeared on the S&P500 has now faded though and has actually been replaced by a bullish signal!

I do not try to predict market direction ever as I am a trend follower and will just tag along once a trend starts. I simply look for a confluence of signals and, at the moment, I don’t have any signals suggesting that stocks or ‘risk appetite’, are making for a correction. In fact, the way the USD and Euro index charts are heading, I’m thinking that the exact opposite looks to be setting up.

I had mentioned over the w/e that the Index Cloud charts were trading such that they could easily flip to ‘risk on’ or ‘risk off”. Three of the four index charts are now aligned for ‘risk on’ trading. The USDX daily chart is trading IN the Cloud but falling as I type.

USDX 4 hr: trading below Cloud and aligned for ‘risk on’

USDX daily chart: trading in the Cloud:

EURX daily chart: trading just above Cloud but still aligned for ‘risk on’. This needs to get over the 108.5 level though. I suspect it will be ‘hold onto your hat’ stuff if this does break through the resistance though!

EURX 4 hr: This has just poked up above the Cloud and is thus aligned for ‘risk on’:

With price trading so close to the Clouds on all time frames though I am open to market swings in either direction. I am simply waiting for all four charts to align with one united direction; either ‘risk on’ or ‘risk off’. The current status seems to favour ‘risk on’ just at the moment.

There is significant data out of the US and Europe over coming days and this could trigger moves with these indices.Wednesday 1st (6.30 am)

The USD continued its slide overnight:

The EURX is holding up but still hasn’t pushed above the resistance 108.5 level yet:

These choppy markets with a falling USD gave a great trade off the 30 min charts during the US session on the E/U. A possible 80 pips!

S&P500: stocks also traded up and this also gave a reasonable long trade during the US session:

S&P500: There had been one initial signal suggesting of bearish reversal on the S&P500. A Tenkan/Kijun cross. This now seems like it may be back to a fused alignment which is rather unhelpful. This index made new highs today and is certainly at ‘make or break’ stage:

A falling USD will help to support stocks, as will the ‘Bernanke Put’. The USD index shows that price is resting on some reasonable support here so might have some work to do:

Tuesday 30th (6.30 am) 76% ROIC from possible SPY trade!

USDX: The H&S pattern seems to have moved on further:

Tuesday 30th (5.40 am) 76% ROIC from possible SPY trade!

The indices are both trying to hang in above their daily Clouds:

These choppy markets continue to give great 30 min trades during the US session. The S&P500 gave a great possible SPY Call trade. A signal came through before the US session but then continued on. The S&P500 was at around $1,581 at the start of the US session:

Thus, I would look to buy the closest May $158 Call Option. From Morningstar, this Option opened at $1.02 and is currently at $1.80. An increase of 0.78 cents:

The S&P500 Ichimoku chart may just turn back to being bullish so I’m watching for the daily close here. The index is near record high levels so is getting close to ‘make or break’ territory:

TS signals:E/U: trading in positive ground

E/J: closed now

A/U: trading in positive ground

A/J now closed too

Cable: struggling at the channel trend line:

Silver: limping along…

Kiwi: this gave a new TS signal on my 11pm candle:

Monday 29th (7pm)

Very new BUT weak signals to LONG A/U and E/U. It would be better to wait for the next candle but that’s 11 pm here….my dream time!

E/U:

A/U

Monday 29th (6.40 pm)

USDX: the USD continues to fall and has reached down to the support of the daily Cloud:

EURX: this is bouncing back up off thin Cloud!

Momentum could shift either way here. I am keeping an open mind about the next momentum move and waiting for clear signals.

BTW: I’ve reviewed a few more of the stocks on my watch list. You can see these on my Stocks:May page.

Monday 29th (6.10 pm)

I’ve reviewed a few more of the stocks on my watch list. You can see these on my Stocks:May page.

Monday 29th (6 pm)

A consistent theme throughout these choppy periods of Ichimoku divergence has been better trading opportunities appearing off the 30 min charts during the US session. I’m wondering if the S&P500, among some others, might be setting up for that:

Monday 29th (5.40 pm)

Wonders never cease!

E/U

A/U

I’ll need the 7pm candle close to check for a TS signal.

Monday 29th (4.50 pm)

USDX: I noted over the w/e some bearish signs that I was seeing on the USDX. A possible bearish Head and Shoulder pattern and bearish ascending wedge. These seem to be playing out:

A bearish follow through here on the USDX would support the bullish patterns I saw and posted for the E/U and A/U:

E/U

A/U

No TS signals here yet though.

This ‘risk on’ action would help the current G/U signal and possibly the Silver too. Not the E/J and A/J short though so I’d have stop to entry on them or take profit.

Monday 29th (4.40 pm) The Cloud Charts!

I use the Index Ichimoku Cloud charts as a kind of weather map to tell me when it’s safe to go out trading. They’re still advising of choppy conditions though with quite variable conditions.

On the w/e they looked like a small down move in the Euro could send them into ‘risk off’ alignment. There has been a bit of a flip today with the USD falling though:

USDX daily: this is getting down close the Cloud (Kumo) but still aligned for ‘risk off’:

USDX 4hr; this is back to trading below the Cloud that favours ‘risk on’

EURX daily: this is in thin Cloud and could move either way from here:

EURX 4hr : below the Cloud and geared towards risk off’ BUT there is only thin Cloud above price which may not be too difficult to navigate through:

So, the Index Cloud charts are still divergent and suggesting choppy action.

Monday 29th (4.10 pm)

There isn’t too much happening just yet so I’ve reviewed a few more of the stocks on my watch list. You can see these on my Stocks:May page.

Monday 29th 3.15 pm

Japan and Chinese bank holidays seemed to have dictated lighter trading than might be normal. Not much has happened.

It was strange though to see both the USDX and EURX fall! The EURX is now in the daily Ichimoku Cloud and falls with the USDX have put the USDX back in the 4hr Cloud: